Do you have too much debt? Need ways to find extra money to help pay it down? Today we look at some options.
So you come to the realization that you need to pay down your debt, and are looking for some available options within your current means. Reviewing your spending for the past few months will help you with spotting the areas that you are overspending in.
While on a day to day basis, buying a coffee, or going to a fast-food restaurant may not seem that bad, but when adding up the totals for the month, or even year, you can get a better idea of the approximate amount you are spending, and this can help you to spot the areas you may need to cut down on or cut out entirely.
The Licensed Insolvency Trustees at David Sklar & Associates will work with you to review your finances and help you establish positive spending habits, and establish a feasible budget. We provide credit counselling sessions alongside our bankruptcy and consumer proposal services to provide our clients with a long-term debt relief solution.
The reality is that buying a coffee and muffin per day going to work, averaged at $5 per day, is $25/week and over $100/monthly. A fast-food restaurant at $10 per day, averages $50/week and over $200/monthly. If you and your spouse go out to a restaurant twice per month, average each meal $50, then for each month that would be an extra $100, and $1200 per year.
Consider the ways you can find extra money to pay off your debt and other living expenses:
Look at Decreasing your Expenses
Looking to cut out fast food and restaurants is a good first start. Start preparing meals for the week for your workday lunch. When using coupons, only purchase items that you would normally buy. Try switching to store-brand items.
Make coffee to go before you go to work and drink the coffee at work. A cup of coffee per day from your favourite coffee place adds up very quickly over the month, and these small changes can go towards paying down your debt even further.
If you are renting, look to getting a home or apartment at a lower price. If you have an extra room in your home, see about getting a roommate. If you own your own home, see if you can refinance your mortgage for a lower interest rate. Granted, housing costs may be a little harder to lower at this immediate time, but they are still viable options to consider. Just by getting another roommate, that full amount can go towards further paying down your debt, and over the course of a year, this really adds up! To help with heating costs, see about installing a programmable thermostat, and seeing up a daily/weekly schedule so you are heating your home more wisely and saving on your heating bill.
Satellite and Cable Costs (Entertain for Less)
Reviewing your monthly cable or satellite costs should be next on the lists. This cost alone can be quite pricy per month. Do you have all the channels, HD and premium channels? Look at reducing these, try going to basic, or even entirely cut it off. In 2012 according to the CTRC, the average Canadian family paid $185 per month for their cable bill, which for one year adds up to $2220.00.
While convenient, avoid the urge to rent on demand, as each movie rental quickly adds to your monthly bill. One extra ondemand movie at $5 each week adds up to $260/per year. Getting movies from your friends or from your local library is a good alternative option. Cutting your cable bill and going with an online service such as Netflix could be a good alternative. If you have an internet connection, many of the big stations have all their top shows available online for viewing. There are many online music streaming available for Canada as well.
Options for Increasing your Income
If your job allows for overtime, see about putting in additional overtime hours for extra money each paycheck. See about getting a second job, or if you have a talent/hobby that can work as a second job this as well would be helpful.
Unwanted Household Items
Do you have a closet or basement of cluttered items you are not using? You can look to seeing items at a garage/yard sale, or try selling on Ebay or Kijiji. Selling the clutter and saving the sales from each of these for additional payments on your debt.
As you can see, once you start to take note of all your weekly/monthly expenses, look at the variable expenses that can be cut, and start there. Reviewing the expenses of both yours and your significant other will help with taking better control of your money, and will help you with finding some extra money each month to pay down your debts faster.